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Wealth Manager: beneath the bonnet of Investec's £7bn, 320-strong funds list
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by David Campbell on Jun 06, 2013 at 00:01
‘This is not a consensual democracy,’ says Andrew Summers, head of Investec Wealth’s £7 billion collectivised fund service, on how the company goes about deciding what funds go in or out.
‘We have 270 managers, so you are never going to reach a consensus. But it is based on a lot of discussion.’
Unspoken in that equivocation is some degree of compromise – which is possibly inevitable in an organisation formed from three discrete historical entities, each with its share of strong personalities, spread across a 15-office national network.
But you don’t have to parse a 320-strong white list too closely to divine some accommodation between prudence and optimal efficiency. Summers provides a spirited case for how such scale can be turned into a strength, but concedes that handed a blank sheet of paper, this would probably not be the point at which he would start.
‘It’s far in excess of our nearest competitor, by a margin of something like two or three times, and we think that puts us in a good position. There are arguments about concentration risk, and people should be choosing us to provide a very broad list to draw on [as a starting point],’ he says.
‘As a career researcher I probably would have fewer, and there would be some practicality benefits. But it’s about finding the compromise between a top-down system and a completely unfettered model where guys are able to do what they want.’
Alongside Darren Ruane (on left in picture below), group head of fixed interest, Summers has headed fund selection since the company’s incorporation as Investec Wealth & Investment following its merger with Williams de Broë and Rensburg Sheppards.
Most convincingly, the company deploys this strength-in-diversity through its research process.
Each analyst on the 18-strong research team is mentored by one of the many investment veterans and sector specialists the company is able to call on, such as listed fund specialist Nick Sketch. This opens up a huge pool of experience.